Fix the unfair business rates system now, CBI tells Javid

SAJID Javid is under mounting pressure to announce a wholesale review of business rates in next month’s Budget.

Dame Carolyn Fairbairn, the director-general of the CBI, has written to the Chancellor demanding an overhaul of the hated tax on firms, including retailers and manufacturing companies.

She is also demanding a string of other measures, including rules to make all business premises greener.

A vocal anti-Brexiteer, Dame Carolyn is now striking an optimistic tone.

She acknowledged there had been a ‘Boris bounce’ in business confidence since the start of the year and said the CBI was an enthusiastic supporter of the Prime Minister’s promise to ‘level up’ the regions.

She is meeting Mr Javid next Monday to discuss the Budget, which she described as ‘a momentous one’. The challenge, she added, was for Mr Javid to turn optimism into a ‘surge in investment’ across the country.

Dame Carolyn said that with a decisive mandate in the election, the Government had a ‘ window of opportunity’ to transform the UK economy.

Business rates are dragging down many parts of the country and adding to the woes on struggling high streets, she said. The CBI wants a comprehensive review that will slash the bills paid by firms by the end of the year. It said the measures being demanded would cost the Treasury £800million annually.

Marks & Spencer blamed business rates for its decision to close more than 100 stores by 2022. The retailer has previously complained it pays more than £180million in rates a year.

Tesco said its annual business rates bill had almost doubled to £700million in the past decade.

This compares to the £63.4million paid by internet shopping giant Amazon in 2018, prompting critics of the system to argue it is disadvantaging retailers with high street shops.

‘When I see the Chancellor, this will be very high on my agenda,’ Dame Carolyn said, adding that she wanted Mr Javid to remove business rates from plant and machinery which makes British industry uncompetitive.

The CBI is demanding steps in the Budget to help bring the

UK further towards its target of net zero carbon emissions by 2050 by making all commercial properties achieve a high grade of energy efficiency within a decade. The business organisation wants a doubling of the funds for on-street electric car charging points by 2024.

Dame Carolyn also wants the Chancellor to set up ‘catapult quarters’ around the country, bringing together businesses, mayors and universities to kickstart innovation.

It comes as the Home Office said low- skilled immigration from the EU is set to fall by 90,000 a year under a proposed points-based system.

Analysis of the plan, which is due to be unveiled in the coming weeks, predicts that the end of free movement at the end of this year will lead to a dramatic drop in the number of people coming to the UK from the EU.

However, it is also expected to lead to an increase in the number of skilled workers coming to work in the UK from around the world.

Mr Johnson and Home Secretary Priti Patel are understood to have agreed the framework of the new system, which will close the route for low- skilled migrants to come to the UK.

In most cases, skilled migrants will have to have a job offer paying more than £25,600 – a lower threshold than currently applies to migrants from outside the EU. Migrants will also earn ‘ points’ for how well they speak English.

In some cases migrants taking jobs paying as little as £23,000 could be granted visas, depending on their skills.